A political recession?

So, the UK is back in recession. Let’s all panic and head for the hills…
Or is it? There are four possible responses to today’s news that an initial estimate suggests the UK economy contracted by 0.2 per cent in the first three months of 2012.
One is political: government policy has failed and the coalition “cut too far and too fast”. The usual hot air, in other words.
The second is geographical: while London, the south and east have steamed ahead, the rest of the country never really climbed out of recession anyway (the further north you go, the more the economy becomes dependent on public money).
The third is scientific: quite a few economists and statisticians simply don’t believe the ONS figures because this general measure has been consistently at variance with what surveys about specific business sectors say. The ONS’s methodology may be a bit flawed.
The fourth is from business: how come the Office for National Statistics says the economy contracted 0.2 per cent when the Derbyshire & Nottinghamshire Chamber’s own survey of the same period said business had regained nearly everything it lost last year?
It really does pay to put the politics to one side, because in a climate like this it generates far more heat than light.
Not for the first time I should also point out that today’s figure is merely an initial estimate based on an analysis of only 40 per cent of the data which ultimately goes into a GDP figure. It will be revised at least three times, and for technical reasons the first quarter of a year is often harder to judge than others.
There is particular concern about the ONS’s assessment of the construction industry. It says weakness here is one of the key reasons for the fall back into recession. Yet the industry itself suggests the picture is not that bad.
And on the very same day that the ONS fingered weak manufacturing as another contributory factor for technical recession, the CBI said there were signs of a bounce back in manufacturing activity during the same period.
Indeed, the CBI has gone on record this morning with its usual diplomatic language, saying it is "surprised" by the ONS figures.
That's putting it mildly. There is a clear conflict between what the ONS is suggesting and what some industries are saying themselves.
Unarguable facts are that our economic recovery is very sluggish and geographically patchy: some sectors are doing better than others, some parts of the country are better than others, some of what we have lost won’t come back because the economy has changed, Eurozone economies still haven’t properly sorted their debt issues.
One more unarguable fact: businesses themselves are sick to the back teeth with supposed media ‘recession porn’ – an obsession with negative economic news.
So the fight over recession is largely political. As tough as it is, business is getting on with the job.